The car manufacturer had said this drop in volume was seen as being temporary. It would recover in the quarter to come based on 11 percent growth in the April-June 2017 quarter compared to 2016.

Tata Motors on Wednesday announced that it has slashed the prices of its passenger vehicles up to 12 per cent, following the roll-out of the Goods and Services Tax (GST).

"We are offering a price reduction of upto 12 percent ranging between Rs 3,300 and Rs 2,17,000 depending on the model and variant," the car maker's President (Passenger Vehicles Business Unit) Mayank Pareek said.

He said the step was taken with a strong focus to encourage positive buying sentiments.

Pareek said the car maker decided to pass on the entire benefit to its customers following the roll-out of GST.

In June, company's passenger vehicles sales in the domestic market were impacted by the mixed reactions towards GST resulting in low buying sentiments.

The passenger vehicle business recorded sales of 11,176 units, lower by 10 percent, over 12,482 units sold in June 2016.

The car manufacturer had said this drop in volume was seen as being temporary. It would recover in the quarter to come based on 11 percent growth in the April-June 2017 quarter compared to 2016.

Welcoming the introduction of GST, Pareek said this would enhance the ease of doing business and usher in a new era for the economy in general and especially, for the automotive industry.